Business News


In Business News this week: Czechs’ high corruption threshold; a change of heart on airport privatisation; multiplexes roll-out in the regions; Czech Airlines searches for new sources of income; and an insurance silver lining to the crisis cloud.

Consultancy survey highlights Czech tolerance of corruption

A survey by international consultancy company Ernst & Young has given a grim picture of Czech business’ tolerance of corruption. The survey of managers and staff in 22 European countries puts the Czech Republic third in a ranking of tolerance towards business bribes following Turkey and Russia. Forty-three percent of Czechs surveyed said they were not bothered by bribes in business compared with a European average of 25 percent. The survey warned that corruption is set to mount during the economic recession with companies’ abilities to counter it weakened by lay-offs.

Social Democrats change stance on Prague airport sale

Václav Havel international airport,  photo: archive of Radio Prague
Czech left-wing party the Social Democrats has stepped back from its resolute opposition to the privatisation of Prague’s state-owned airport. Leader Jiří Paroubek said this week that a sale could be contemplated but only when the economic situation improves. Mr Paroubek’s party previously took a firm stand against the sale of Central Europe’s busiest airport and has called for the new caretaker government to rule it out. Prime Minister Jan Fischer this week said his government would not take a decision on privatisation but the process could continue.

Multiplexes roll out in the regions

The country’s biggest operator of multiplexes, Palace Cinemas, has unveiled plans for three more. All three should sprout up outside the capital Prague, where most of the complexes are now concentrated. The first Czech multiplex was opened in 1999 with 24 operating across the country at the start of this year. The development has not been without problems with one Prague multiplex shutting its doors earlier in 2009.

Czech Airlines seeks new income after first quarter loss

Radomír Lašák,  photo: CTK
Czech Airlines this week announced a first quarter loss of 1.32 billion crowns or around 69 million dollars. Company boss Radomír Lašák has predicted that this could be cut to 361 million crowns by the end of the year. The airline is now looking into various money spinning ideas to get more cash from travellers. These include offering travel insurance, charging more for excess baggage and paid for upgrades to business class and airport lounges. Mr Lašák said in an interview that Air France would be a perfect partner for the state owned airline which is being prepared for privatisation. Air France KLM is one of the two remaining bidders for the Czech carrier.

Consumer credit insurance booms in gloomy times

The economic crisis has had a silver lining for one business sector at least – insurance cover for consumer loans. Insurance taken out to cover non-payment of such loans has shot up since the start of the year by several dozen percent because of worries over unemployment and tougher times to come, according to consumer loans companies. Cofidis is one such company. It says insurance against non-payment has risen by 15 percentage points in just over six months with 84 percent of borrowers now taking up the option.